In the middle of the US-China tech war, Shanghai Fudan Microelectronics is showing resilience despite new American trade sanctions. Recently included in Washington’s Entity List, the firm declared it will remain “independent and controllable,” while continuing open collaboration with global semiconductor partners to ensure sustainable growth.

Background: What Happened

The US government announced sanctions targeting 23 Chinese firms, including Fudan Microelectronics, citing links to China’s military modernization and alleged support for Russia’s defense sector. Being on the Entity List means restricted access to advanced American technologies, a significant hurdle for any chipmaker competing in today’s global market.

Fudan’s Response and Key Strategies

• Strengthened supply chain resilience: Since 2022, Fudan has actively diversified suppliers across China and overseas, ensuring stability even during global disruptions.
• Strategic reserves: The company’s reserves of raw materials such as silicon wafers jumped from 600 million yuan in 2020 to more than 3.1 billion yuan in 2025.
• Lawful & compliant operations: Fudan emphasizes that it always complies with global trade standards and international regulations.
• Open collaboration: Despite restrictions, the firm continues to pursue joint semiconductor projects with partners worldwide.

Impact on Business and Market Sentiment

The sanctions caused mixed reactions in financial markets. The company’s Hong Kong-listed shares fell by nearly 4%, reflecting investor caution. However, its Shanghai-listed shares rose slightly, highlighting domestic confidence in China’s long-term semiconductor ambitions. This contrasting market behavior shows the delicate balance between global risk and local opportunity in China’s chip sector.

China’s Wider Semiconductor Push

The US-China chip conflict has intensified in recent years, with Washington tightening export restrictions on advanced processors and AI chips. In response, Beijing is doubling down on self-reliance, providing policy incentives, financial support, and R&D funding for domestic companies. Fudan’s efforts mirror this broader strategy: strengthening supply chains, stockpiling resources, and accelerating technological independence.

What’s Next for Fudan Microelectronics?

1. Domestic innovation: Fudan is expected to invest more heavily in local research and development to replace restricted US technologies.
2. Global diversification: Building supply partnerships in Asia, Europe, and the Middle East will reduce reliance on US exports.
3. Government support: China’s Ministry of Commerce is actively launching investigations into US trade practices, signaling stronger backing for its local chipmakers.
4. Strategic transparency: By promoting lawful and compliant operations, Fudan aims to maintain trust with international partners.

Conclusion

Shanghai Fudan Microelectronics’ reaction to sanctions is a case study in resilience. Through strategic reserves, diversified supply chains, and open collaboration, the firm plans not only to endure restrictions but to thrive despite them. As the US-China tech war continues, this struggle highlights a larger shift: China’s determination to secure semiconductor independence and showcase its technological strength on the global stage.